A New Computer System Is Expected to Cost $40 Million

question 86

Multiple Choice

A new computer system is expected to cost $40 million and generate annual savings of $12 million over the next five years. What is the IRR for this investment?

• A)11.18 percent.
• B)12.98 percent.
• C)15.24 percent.
• D)12.00 percent.
• E)18.00 percent.

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Definitions:

Allocation

The process of distributing resources or tasks among people or groups based on a plan or system.

360-degree Feedback

A comprehensive performance appraisal system where feedback about an employee is collected from supervisors, peers, subordinates, and sometimes, from external sources like clients and suppliers.

Power

The ability to influence or control the behavior of people and the course of events.

Information Power

is derived from possessing, controlling, or having access to valuable information that others need or want.